Action Learning

Case Study --Telecom Operations

The Background

"ConCom" was a telecommunications company that operated in a number of cities and
regions scattered throughout the United States. Although a mid-level firm in the telecom
industry, ConCom would be considered a large organization by most
standards. They employed well over 10,000 people. Some parts of the firm dated to the
early 1900's and the general culture was bureaucratic,
functionally organized and centralized.

This example comes from Strategos' consulting experience. The
client's identity is disguised for competitive reasons but the essential facts and
events are real.

Top management
recognized that radical change was necessary for long term survival.
They decided to experiment with a Kaizen Event aimed at improving a major process.
However, they had larger goals than those for the usual Kaizen Event.
They wanted to deal with large-scale, company-wide processes
and they also wanted to begin a major cultural change
that would make the firm more responsive to the changing environment and changing
technologies.

A rather long list of problem areas that were
critical to competitiveness had been developed. From this list, a small Steering Committee
selected one particular problem for the initial event.

The Problem

ConCom had developed a
networking product that used very expensive existing infrastructure to network customer
organizations having scattered locations. For many business and technical reasons, this product
offered significant advantages for both ConCom and their customers.

The problem was that ConCom required an average of three months to install the system.
Competitors were installing functionally equivalent systems in weeks.

A small headquarters
group had investigated this problem. This group had not clearly identified the root causes or
developed viable solutions due to the complexity and internal politics
of the situation. Nevertheless, their work was valuable in developing the project scope and in
planning for what became a sort of Super-Kaizen Event. One
thing that was clear from the headquarters investigation was that the
problem was highly complex and involved many functional groups. These groups often
did not communicate well.

The Action Learning Team

Because of the scope
and complexity of the problem, a rather large team of about 35 people
was assembled for a three-day event. The team had
representation from every region, from every functional group and from
all levels of the organization. It included line installers, clerical workers,
supervisors, managers and senior managers. It represented sales, engineering, Operations,
Scheduling and other functions. Some of these people knew each other from telephone
conversations but most had never met.

The Steering Committee
recognized that a broad, company-wide consensus was a
necessary part of any solution. They publicized the event widely within the firm and requested
nominations for team members. It was important to ensure that not only
was the solution a good one, but that it would be acceptable to the various constituencies.

Top management gave absolute support to the team. It was made clear to all
concerned that the team's recommendations WOULD be
implemented. they ensured that the best people were sent. They provided travel and accommodation
for the team and rented a first-class meeting facility with luncheon accommodations and breakout
rooms.

Ultimately, the team
resembled (at least in some respects) the constitutional convention of 1788. From the intensity
of debate, the rhetoric, the negotiation of provincial interests and the seriousness of
attitudes one would think they were founding a nation.

The Results

Within the three-days
of sessions the team identified root causes and three viable solutions. The root cause was a
cumbersome and little-understood process for planning and implementing an installation. This
process was centrally controlled at corporate headquarters but the control was illusory.
Moreover, the process did not allow for wide variation in the nature of individual
installations. Thus, every installation was planned and executed as though it were the most
complex and difficult installation.

Solution #1

This solution made
minor changes to the existing process. It was least disruptive to the organization and power
structure, acceptable by most constituencies but offered only minor improvements in installation
time.

Solution #2

This solution made
major revisions to the process but retained corporate control. It would reduce installation time
by 50%.

Solution #3

This solution
radically changed the nature of the process. It delegated management of each installation to
local project managers and provided for installation teams that would absorb the activities of
several functional groups. It offered much greater reductions of installation time but required
a major disturbance of the organization and power structure.

What They Did

Because of the
members' inexperience with team activities and the time constraints. facilitators played an important but not dominant role.
Strategos provided two facilitators. The client assigned several facilitators from one of their
groups with prior team experience. The facilitators developed an outline schedule, conducted
initial training in teamwork and introduced several analysis techniques.

Strong facilitation proved necessary in the beginning as some team members had
considerable trouble staying on topic, presenting views concisely and refraining from
interrupting others. However, by the third day most participants had
adapted to group norms and the team had coalesced and matured considerably.

Aside from the scope
and complexity, the team approached the project in a typical process improvement way. They used
the problem solving procedure of figure 3, examined the
present state by analyzing existing data, identified root causes with fishbone diagrams and
developed solutions through brainstorming.

The most important
sessions involved the construction of a Present State Process Chart.
The chart was extremely complex and covered a large wall. It was evident from early on that
no one person understood the process. Individuals knew that
they received information or documents, acted on that information and sent information out.
Other than that, almost nobody knew what had happened before, where information originated and
what others used it for.

There developed some
curious circumstances surrounding installation milestone dates.
These dates were important to installation personnel. Missed milestones
were dealt with harshly. they showed up in performance reviews, salary reviews and,
occasionally, letters of reprimand. However, it came to light that when milestones where
accomplished early, this early accomplishment was totally ignored.

The question was
asked, "who sets milestone dates?" Nobody seemed to know the
answer. It finally developed that milestone dates were set by a clerical employee at corporate
headquarters. Moreover, the time allowed was arbitrary and set without any knowledge of the
complexity of the installation. Every installation, whether simple or
complex, had the same allocated time and this time was sufficient for the most complex
installation. There were many other such revelations as the sessions continued.

After the present
state analysis, the group broke into sub-teams to work on
various aspects of the problems. These sub-teams would convene, report back and then
re-convene with different members for the next stage of the
problem solving.

One important aspect
of the session was the use of daily newsletters. A scribe
was appointed who summarized each day's activities. Each delegate emailed this newsletter to
their constituencies and asked for comments and inputs. In this way, news of the team's progress
spread through the organization and feedback was received. This generated a great deal of
interest and conversation throughout the organization as many others followed the team's
activities and deliberations.

At the end of each
day, time was allowed for reflection and discussion of the
team process and learning experience. Surveys were done to help evaluate the effects and
encourage participants to think about their experience.

While the team
recommended solution #2, they also setup an online survey to solicit
comments and opinions from others in the organization. This promoted even broader
participation and support.

The team made a
presentation to top management and then individual delegates
made similar presentations in their various regions. The
organization was enthusiastic about the results and the process.
As a result, additional such events were scheduled.

Strategic Issues

Another strategic
issue was revealed during the project, although few appreciated it at the time. This was the
integration of Marketing and Operations strategy.

The ability of
ConCom's infrastructure to support this new product varied greatly
between their various service areas and it also varied within the service area. Some locations
could install the product quickly and easily; others could not. Much depended on the history of
the infrastructure and what point in time it had been installed.

It appears that
when marketing rolled out the product, they ignored these differences.
the product was promoted equally in all regions. This had several effects. First, it
required a major marketing effort in all regions rather than
concentrating resources. In some regions, the product could be offered quickly and
inexpensively. In other regions the product required major efforts and cost that was passed on
to the customer.

This also
affected cash flow. ConCom might have done better to
concentrate marketing in areas where the infrastructure supported the product best. They might
have quickly achieved a dominant market share in those
areas. The improved cash flow might then have been used to upgrade infrastructure in other
areas.

From the operations
side, it appeared that there was little in the way of master planning
that would allow an orderly upgrade of the infrastructure to
support this and similar products. The result was a hodge-podge of infrastructure technologies
and considerable unnecessary cost.

This Action Learning project was, hopefully, the beginning of a transformation of ConCom to a
true learning organization. However, it will be several years before it is known whether the
transformation is successful or not.